(SNews) – Democrat President Joe Biden’s globalist green agenda has just been hit with a severe blow after the world’s largest offshore wind farm developer abandoned two major U.S. projects.
Danish wind energy company Orsted A/S announced it has pulled out of the projects due to supply chain and interest rate impacts and recorded impairment charges well above previous forecasts.
Orsted says it was forced to cease the development of the Ocean Wind 1 and 2 projects off the coast of New Jersey.
The news comes amid a wider downturn in the green energy industry.
As Slay News reported last week, several major automakers have just announced that they are scaling back production of expensive electric vehicles (EVs) amid declining consumer interest and slow sales.
In a seemingly coordinated move, Ford, Honda, and General Motors all announced significant rollbacks of EV production.
In a statement about the canceled wind farm projects, Orsted said:
“US offshore wind projects have experienced further negative developments from adverse impacts relating to supply chains, increased interest rates, and the lack of an OREC (Offshore Renewable Energy Certificate) adjustment on Sunrise Wind.
“Total impairments recognized in the interim financial report for the first nine months of 2023 amount to DKK 28.4 billion [$4 billion], and the majority of these (DKK 19.9 billion) relate to Ocean Wind 1,” Orsted stated.
This figure is much larger than the previously announced impairment in August on its U.S. portfolio of up to DKK 16 billion.
“This is a consequence of additional supplier delays further impacting the project schedule and leading to an additional significant project delay,” the company said.
Orsted CEO Mads Nipper said he was “extremely disappointed to announce that we are ceasing the development of Ocean Wind 1 and 2.”
“The significant adverse developments from supply chain challenges, leading to delays in the project schedule, and rising interest rates have led us to this decision, and we will now assess the best way to preserve value while we cease development of the projects,” he added.
Following the news, shares in the Denmark-listed green energy giant crashed as much as 22%.
Share prices fell to lows not seen in six years.
The move may not have been a surprise, however.
In August, Nipper warned that the projects were facing headwinds.
“The situation in U.S. offshore wind is severe,” Nipper asserted.
“We are still upholding a real option to walk away,” he told Bloomberg a few weeks later.
The Biden administration has touted offshore wind farms as an essential component of “decarbonizing” America’s energy grid.
Under the Inflation Reduction Act, Orsted has received upwards of 30% tax credits.
However, the tax credits are no longer enough as a financial crisis continues to brew in the offshore wind power industry.
Last week, Germany’s Siemens Energy crashed.
The crash came after the company warned its wind turbine business is grappling with quality issues and offshore ramp-up challenges.
In the solar industry, meanwhile, SolarEdge Technologies shares plunged about two weeks ago.
The drop in share prices came after the company warned that European demand is sliding.